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Monday, February 27, 2017

Universal Basic Income is Welfare

Ebay founder Pierre Omidyar is the latest tech bigwig to get behind the concept. His philanthropic investment firm, the Omidyar Network, announced Wednesday that it will give nearly half a million dollars to a group testing the policy in Kenya.

Universal basic income is the notion that a government should guarantee every citizen a yearly sum of money, no strings attached. The thinking is that such a program would relieve economic stress as automation technology severely reduces the demand for labor.

Theories along these lines have existed for centuries, but their proponents have never had much luck convincing governments to give them a shot. Thus, the only data on real-world effects come from a few scattered experiments throughout the years.

GiveDirectly is looking to add to that knowledge with one of the biggest trials of a basic income system in history.

The group recently launched a 12-year pilot program in which it plans to give 6,000 Kenyans regular stipends for the entire duration. Around 20,000 more will receive at least some form of cash transfer.

The Omidyar Network is hoping the study will help advance the debate around basic income from broad theoretical terms to more practical considerations.

"While the discussion has generated a lot of heat, it hasn’t produced very much light," wrote the Omidyar Network's Mike Kubzansky and Tracy Williams in a blog post announcing the pledge. "There is very little research and empirical evidence on how and when UBI could best be used."

Omidyar isn't the only tech mogul backing efforts to take the theory from paper to practice.

Startup incubator Y-Combinator is in the midst of one such study in the Bay Area, and its president, Sam Altman, and Facebook co-founder Chris Hughes have kicked $10 million towards another research project.

A number of other tests have also cropped up in recent months as universal basic income finds more mainstream acceptance.